New York Sales Tax Guide 2025: Compliance, Rates, Guidelines

Navigate New York sales tax regulations effortlessly with this guide, crafted to help you achieve accuracy, avoid mistakes, and steer clear of penalties for non-compliance.

Sales Tax in New York

Sales tax in New York was introduced in 1965 to generate revenue for public services. Governed by New York sales tax law, the Department of Taxation and Finance oversees the state’s tax policies, including New York sales and use tax, which applies to most goods and services.

New York Sales Tax Rate

Jurisdiction	Sales tax rate
State tax	4.0%
Local tax	0.0%-4.875%
Combined Tax	4.0% - 8.875%

Learn more and check out the city-based tax rates in New York.

New York Sales Tax Calculator

A New York sales tax calculator helps retailers accurately determine the total sales tax owed on transactions by applying the combined state (4%) and local tax rates, which vary by jurisdiction. This tool ensures compliance with New York sales tax law and prevents over- or under-collection of taxes when selling taxable items.

Scenario: A retailer in Albany County, where the combined sales tax rate is 8%, sells an item priced at $200.

1. Determine the Tax Rate:
   1. New York City State sales tax: 4%
   2. Albany County local sales tax: 4%
   3. Total combined rate: 8%
2. Calculate the Sales Tax:
3. $200 × 8% = $16
4. Determine the Total Price Charged to the Customer:
5. $200 (item price) + $16 (sales tax) = $216

By using a sales tax calculator, New York retailers can quickly calculate the tax owed for each sale, ensuring compliance with New York sales and use tax regulations. This is especially useful for businesses operating across multiple jurisdictions with varying local tax rates.

FAQs on Sales Tax

What is the current New York state sales tax rate?

The current New York state sales tax rate is 4%, with additional local taxes varying by jurisdiction.

What is New York's sales tax rate for a vehicle?

The sales tax rate for vehicles in New York includes the 4% state rate plus local taxes based on the buyer’s county of residence.

What is the sales tax rate in Purchase, NY?

The sales tax rate in Purchase, NY (Westchester County) is 8.375%, which includes the state rate and local taxes.

How to calculate tax in New York? Multiply the item's price by the combined state (4%) and local tax rates for the jurisdiction where the sale occurs. Please check the sales tax calculator section above for a detailed example.

What is the sales tax in New York calculator? A New York sales tax calculator is a tool that helps businesses determine the total tax owed by applying the combined state and local tax rates to a transaction.

Sales Tax Nexus in New York​

Type of Nexus	Threshold
Physical presence	Any physical presence
Economic nexus	$500,000 in gross sales
Marketplace nexus	$500,000 in sales facilitated by a marketplace

FAQs on Sales Tax Nexus

What is the sales tax nexus in New York?

Sales tax nexus in New York is established when a business has a physical presence in the state or exceeds the economic threshold of $500,000 in sales and 100 transactions annually.

Does NYC have nexus?

Yes, businesses with a physical presence or exceeding economic thresholds in NYC have sales tax nexus and must collect and remit local sales taxes.

What is the Nexus threshold for sales tax in NY?

The nexus threshold for New York is $500,000 in annual gross receipts and 100 or more transactions with in-state customers.

Do I have sales tax nexus in New York?

You have sales tax nexus in New York if your business has a physical location, employees, inventory, or meets the economic threshold in the state.

New York Sales Tax Exemptions​

New York sales tax exemptions provide relief for certain purchases, reducing tax liabilities for eligible businesses and consumers. Common exemptions include items for resale, manufacturing equipment, and select categories like groceries and prescription medications.

Exemptions also apply to specific tangible personal property or services, and businesses must track use tax obligations when taxable items are used without sales tax being collected. These exemptions benefit businesses operating in New York City and statewide, ensuring compliance while lowering costs.

FAQs on Sales Tax Exemptions

What’s a New York state tax-exempt certificate?

A New York state tax-exempt certificate is a document that allows eligible buyers to make tax-free purchases on qualifying goods or services.

What’s New York sales tax exemption?

New York sales tax exemption refers to the exclusion of certain goods or services, such as clothing under $110, from state and local sales taxes. Learn more about New York sales tax exemption.

Is there sales tax on clothing in NY?

Clothing priced under $110 is exempt from sales tax in New York, but items over this threshold are taxable. Learn more about New York sales tax on clothing.

What is New York sales tax rate on clothing?

The sales tax rate on clothing over $110 in New York is the combined state rate of 4% plus applicable local taxes.

What are NYS tax exemptions?

NYS tax exemptions include items such as unprepared food, prescription medications, clothing under $110, and goods purchased for resale.

What items are exempt from sales tax in New York?

Exempt items include unprepared groceries, prescription medications, clothing or footwear under $110, and certain tangible goods purchased for resale.

Do New York sales tax exemption certificates expire?

Yes, New York sales tax exemption certificates may expire and require renewal, depending on the type of certificate issued.

What services are exempt from sales tax in New York?

Exempt services include medical, educational, and certain professional services that do not involve the transfer of tangible personal property.

How do I apply for sales tax exemption in New York?

To apply, businesses must register with the New York Department of Taxation and Finance, obtain a Certificate of Authority, and submit the appropriate exemption forms.

Do you collect sales tax in New York on clothing?

Yes, sales tax is collected on clothing priced over $110, but clothing under this threshold is exempt.

Is there sales tax on clothing accessories in New York?

Yes, accessories such as handbags, jewelry, and watches are subject to sales tax in New York, regardless of their price.

What's the New York Sales Tax Registration Process

Here's a step-by-step guide to navigate the sales tax registration process in New York.

1. Determine Your Nexus Status. Assess whether your business has sales tax nexus in New York City, either through physical presence (e.g., office, warehouse, or employees) or by meeting the economic threshold of $500,000 in annual sales and 100 transactions.

2. Gather Required Information. Prepare the necessary details for registration, including:

• Business name and address
• Federal Employer Identification Number (FEIN) or Social Security Number (SSN) for sole proprietors
• Business type (LLC, corporation, partnership, or sole proprietorship)
• Description of products or services sold
• Start date of taxable sales in New York

3. Visit the New York Department of Taxation and Finance Website. Access the official website at www.tax.ny.gov and navigate to the “Online Services” section to begin your registration.

4. Create an Online Services Account. Set up an account in the New York State Online Services portal if you do not already have one. This account will be used to register, file, and manage your sales tax obligations.

5. Complete the Certificate of Authority Application. Fill out the online application for a Certificate of Authority, which authorizes your business to collect and remit sales tax in New York. Indicate whether your business will operate as a vendor, wholesaler, or both.

6. Submit Required Documentation. Attach or upload any additional documentation required, such as business registration forms, proof of identity, or information about nexus activities in New York. Sales tax forms are accessible here.

7. Review and Submit Your Application. Double-check all the information in your application to ensure accuracy before submitting it to the New York Department of Taxation and Finance.

8. Receive Your Certificate of Authority. Once approved, you will receive your Certificate of Authority, which must be displayed at your place of business. This certificate is required to legally collect sales tax in New York.

9. Set Up a Tax Collection System Configure your point-of-sale (POS) system or accounting software to calculate and collect the correct sales tax based on the state’s 4% rate and applicable local tax rates.

10. Understand Filing Obligations Familiarize yourself with your filing frequency (monthly, quarterly, or annually) based on your anticipated sales volume, and ensure you meet reporting deadlines to stay compliant.

Who must register for NYS sales tax?

Any business with sales tax nexus in New York, including those with a physical presence or meeting the economic threshold of $500,000 in sales and 100 transactions annually, must register for NYS sales tax.

New York Sales Tax Filing

Filing New York sales tax requires businesses to report taxable and exempt sales, calculate the tax due based on state and local rates, and remit payments to the New York Department of Taxation and Finance. Businesses must file returns according to their assigned frequency—monthly, quarterly, or annually—depending on their sales volume.

Accurate recordkeeping of sales transactions, exemption certificates, and use tax is essential to complete the filing process. All filings are submitted through the state’s Online Services portal, ensuring compliance with New York sales tax laws and avoiding penalties.

What are the New York filing requirements?

New York filing requirements include reporting taxable and exempt sales, remitting the correct amount of sales tax, and maintaining accurate records, all submitted via the state’s Online Services portal.

What does New York sales tax apply to?

New York sales tax applies to tangible personal property, certain services, and specific digital goods unless an exemption applies.

How much is a sales tax permit in New York?

A sales tax permit, known as a Certificate of Authority, is free to obtain in New York, but businesses must register with the Department of Taxation and Finance.

How often do I have to file sales tax in New York?

Sales tax must be filed either monthly, quarterly, or annually, depending on your business’s sales volume, as determined by the New York Department of Taxation and Finance.

New York Sales Tax Due Date​

Filing Frequency	Due Date
Monthly	Every 20th day of the month(Ex. Due date for January is February 20)
Quarterly	Every 20th of the month following the quarter’s end. (Ex. Due date for Q1 (January 1 – March 31) is April 320)
Annually	March 20 of the following year

What are the due dates for NYS sales tax?

NYS sales tax returns are due on the 20th of the month following the end of the reporting period (monthly, quarterly, or annually).

What is the deadline to pay NY state taxes?

The deadline to pay New York state taxes aligns with the filing due date, typically April 15 for income taxes and the 20th of the month for sales tax filings.

New York Sales Tax Revenue Service

For any concerns about New York sales tax registration, filing or general inquiries, you can reach out to them through the following:

• Phone: (518) 457-5735
• Website: https://www.tax.ny.gov/

Now you understand New York sales tax better. Want to skip the hassle of managing sales tax so you can focus on your business growth? Try Kintsugi—sign up or book a demo today.